Fed keeps rates unchanged, remains on road to December hike

The Federal Reserve kept interest rates unchanged on Wednesday and pointed to solid U.S. economic growth and a strengthening labor market while playing down the impact of recent hurricanes, a sign it is on track to lift borrowing costs again in December. Investors had all but ruled out a rate hike at the central bank’s policy meeting this week and attention has largely been focused on who will be in charge of monetary policy at the end of Fed Chair Janet Yellen’s first term in February 2018. U.S. Treasury yields and short-term interest rate futures were little changed after the release of the statement, while federal fund futures put the odds of a December rate hike at about 98 percent, according to CME Group’s FedWatch program. The U.S. dollar pared gains against a basket of currencies and the S&P 500 index rose slightly.The Fed has raised rates twice this year and currently forecasts another nudge upwards in its benchmark lending rate from its current target range of 1.00 percent to 1.25 percent by the end of 2017.